mARCH 2012
www.lawyer-monthly.com Legal Expert Board 41
Offshore Companies UAE
Continuing with our focus on Offshore Companies and the issues raised when doing business in offshore centres, Lawyer Monthly speaks to Samer Qudah, Partner and Head of the Corporate Structuring Department at Al Tamimi & Company in Dubai. with ten offices in six countries and the expertise of over 195 internationally qualified and local lawyers, Al Tamimi & Company is the largest law in the Middle East, offering clients full service capability. The firm specialises in local law and is one of the few law firms in the region with a dedicated Corporate Structuring team.
Q
what are the main benefits for companies choosing to invest in offshore jurisdictions?
To address the demand for offshore jurisdictions, the UAE has established two offshore jurisdictions geographically located within its territorial limits, namely Ras Al Khaimah Offshore (RAK) and Jebel Ali Free Zone (JAFZ). RAK and JAFZ offer a host of benefits including (i) tax exemption, (ii) no limitation on foreign ownership, (iii) no minimum share capital requirement, (iv) high level of confidentiality of ownership, (v) permission to invest shares of companies in the UAE or internationally, (vi) permission to open bank accounts (non checking) in the UAE, (vii) no limitation on repatriation of funds, and (viii) permission to own real estate in designated developments in the UAE.
The above-stated benefits have seen various
corporate structures emerge, satisfying a variety of commercial objectives. For instance, holding companies have been incorporated, which allow group companies to reorganise and centralise dividend receipts, and to manage finances or their subsidiaries with tax efficiency. Companies are also incorporated to serve as an investment vehicle, or merely for purposes of storage of wealth.
Q
what are the main legal implications that companies should be aware of when looking to invest in your jurisdiction?
UAE offshore jurisdictions have certain limitations and restrictions, the most notable
of which is the general restriction on directly carrying on business in what may be regarded as mainland UAE. As such, RAK and JAFZ are viewed more so to facilitate the above-mentioned activities, than to be fully-fledged operating companies within the UAE.
Contrary to global trends, UAE legislation continues to encourage companies to benefit from offshore jurisdictions, whether in the UAE (such as RAK and JAFZ) or others (such as the Cayman Islands or the British Virgin Islands), and no attempts have been made to introduce legislative curbs thereon.
Q Q
what are the main types of casesyou deal with and the main challenges faced?
The UAE offers a variety of corporate vehicles and the option of setting up in various jurisdictions, each with its own strategic advantage. In addition to RAK and JAFZ offshore jurisdictions, a company may be set up in one of the many ‘free zones’ which permit 100% foreign shareholding, or in mainland UAE which generally limits foreign shareholding to 49%. The challenge for the Al Tamimi Corporate Structuring team is to conceive optimal corporate structures, which often involve a multijurisdictional dimension, be it for corporate structuring or restructuring, by utilising appropriate corporate vehicles to
In your opinion, what do you think has been the most important legislative change for this sector recently?
achieve the commercial objectives of the client while staying within the precincts of statutory limitations and accepted practices of each jurisdiction, in order to ensure the structure can be effectively implemented.
We have seen the UAE’s recently established offshore jurisdictions flourish. This has been facilitated by the liberal policies of the UAE Government as well as an enabling outlook of the regulatory bodies. In our experience, judging by the steady growth in the last two quarters of 2011 and the continuing trend in 2012, we foresee an exciting time ahead for doing business here in the UAE. LM
Q Contact Details:
Is there anything else you would like to add?
Samer Qudah
Tel: +971 (0)4 331 7161 Email:
s.qudah@tamimi.com
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